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Coddan CPM Ltd. – Company Registration Agent in the UK
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Company Formation in Saint Vincent

Our Packages



This St. Vincent company creation package is for customers, who require to set-up a company in Saint Vincent with a registered office address. The establishment of a company in St. Vincent takes 3 days.

The following documents will be sending by post upon the incorporation of your Saint Vincent company:

    • A certificate of incorporation, bound copy of the memorandum and articles of association;
    • The minutes of the first meeting & elegant share certificates;
    • Additional services are available.



This St. Vincent company start-up package is especially for clients, who are requiring forming a company in Saint Vincent with a registered address, registered agent & a nominee director; bank account upon request.

This St. Vincent company incorporation offer includes everything in the first option, together with the advantages of:

  • The provision of a nominee director; the signed power of attorney;
  • The signed, undated resignation letter from a nominee director of your offshore company;
  • Additional services are available.



This is one of the most popular St. Vincent company incorporation packages with nominee shareholder, as an additional option to the nominee director, registered agent & registered office address in Saint Vincent.

This St. Vincent company formation offer includes everything in the second option, plus the following:

  • The provision of a nominee shareholder service for one year;
  • The declaration of trust signed by a nominee shareholder;
  • The certificate of the confirmation of a beneficial owner. Bank account is available on request.



This is our most comprehensive St. Vincent company registration package with all documents verified by solicitor or notary public & certified by the Apostilled stamp or Apostille seal affixed.

This St. Vincent company formation offer includes everything in the third option, plus:

  • The certification of all corporate documents, including a power of attorney, by solicitor or notary public & the final verification of all company' documents by an Apostille seal;
  • Additional services are available.

Welcome to Coddan online St. Vincent and the Grenadines International Business Companies formation agent. We recommend reviewing this site in its entirety, so that you are knowledgeable of St. Vincent and the Grenadines jurisdiction and the powers granted to St. Vincent and the Grenadines companies. We will guide you through the process of registering your offshore company and establishing your registered identity. Complete and submit an IBC application form. Adequate completion and submission of this form, along with the provision of payment, will enable Coddan to incorporate your proposed company within three business days. We will express mail your corporate documents to the mailing address you specify in your incorporation order. If you want to become familiar with the description and the contents of St. Vincent and the Grenadines companies formation packages, offered by Coddan and to find above, what kind of service is included in this or that St. Vincent and the Grenadines companies incorporation package, to get an idea about the price of annual renewal of the service, and about the general legal requirements to the St. Vincent and the Grenadines companies incorporation, please, select the package you need from the list, situated below the banner. The information in the banner will be renewed according to the package you've chosen. When thinking in asset protection and tax shelter, offshore companies and trusts are among the best ways of protecting wealth. Through our network of associates, located throughout the offshore world, Coddan can offer a very cost-effective yet efficient company formation service.

St. Vincent and the Grenadines is an independent English-speaking nation, located in the Eastern Caribbean. In 1996 there were comprehensive legislative changes to its IBC Act, bringing St. Vincent to the forefront of the world's offshore financial centres as one of the safest and most private jurisdictions. IBC's incorporated in St. Vincent are completely free of all taxes for a period of 25 years. There is no requirement to disclose the beneficial owner of the IBC and bearer shares are allowed. There are no exchange controls. There are no tax information exchange treaties with any country.

St. Vincent And The Grenadines Companies Formation. St. Vincent And The Grenadines Executive Summary

Coddan will help you to protect your assets, maintain privacy and create wealth with the use of offshore companies and offshore trusts. We form IBC's & Hybrids in less than 48 hours for persons who wish to preserve their privacy, protect their assets and create new wealth. We set up offshore bank accounts and offshore credit card accounts. We also form offshore LLC's, hybrid companies, international banks, offshore insurance companies and mutual funds. We have helped hundreds of people in many countries around the world and would welcome the opportunity to help you to secure your present well-being and your future by preserving your privacy, protecting your assets and creating wealth.

The first thing you must do is take the necessary step to protect what you own now and what you are about to earn. The structure used for this purpose by financially smart people is a Trust or an International Business Company (IBC). Should you get an IBC (International Business Corporation) or a Trust? Why should you even think of getting one of these? These are the questions that we will now answer.

When you operate through an IBC or Trust, no one has to know that you are involved in any business or investments unless you tell him/her. All of your business may be conducted offshore, away from the snooping eyes of neighbors and the authorities who always want to know what you are doing, because they want to maintain control over their citizens. This is a conflict between your Constitutional and natural right to be a sovereign individual and governmental authorities who want to classify, categorize and control you.

The laws of St. Vincent & the Grenadines make provisions for you to own your IBC through "Bearer Shares". Unlike Registered Shares, Bearer Shares do not carry the name of the owner of the shares. Instead, the person who has possession of the shares is the one who owns them. This means that your share certificates should be kept in a safe place where the wrong person cannot get his/her hands on them.

You may place your assets in a trust or IBC and remove them from attack by creditors as long as the transfer was an arms length transfer. That is to say that you made the transfer when you were not faced by bankruptcy and making an effort to hide it away from creditors.

Before a creditor can attack your assets in a trust in St. Vincent, s/he must first post bond in the sum of $25,000, before s/he can appear in court. Few persons can afford to take the weeks and even months away from home and work to come to St. Vincent to sue you, your trust or IBC. What is more, s/he will be confronted by a different set of laws, with statutes of limitations that may be different from his/her homeland.

When you have an IBC or Trust, you will be able to make investments through one of these that may not be available to you as a citizen or resident of your home country. This is especially true of US citizens. A number of mutual funds as well as other investment vehicles refuse to deal with US citizens or residents. In some instances, US nationals may purchase securities from other countries, but as American Depository Receipts (ADR's). They cannot make direct purchases of the underlying stock.

The state of St. Vincent and the Grenadines (SVG) is in the Caribbean, 1,600 miles southeast of Miami and 100 miles from Barbados. SVG consists of a group of 18 small islands, of which the biggest is St Vincent, with the capital, Kingstown, which has a natural deep-water harbour. St Vincent is a lush volcanic island, just 18 miles north to south and 11 miles wide; the climate is tropical.

Fought over for nearly a century by the French and British, sovereignty of SVG was settled on the British in 1783. Now SVG is an independent parliamentary democracy, with a legal system based on common law. The currency is the Eastern Caribbean Dollar (EC$) which is linked to the US$ at an exchange rate of 2.7 EC$ to 1 US$, and is managed by the Eastern Caribbean Central Bank with headquarters in St. Kitts. The economy moved from dependence on sugar to dependence on bananas; but tourism is now the biggest earner, and the government has been trying hard to build a financial services centre. Economic growth was dented by a combination of climatic problems, 9/11 and the need to rein in a free-wheeling financial services sector to placate the OECD and FATF. A new government which took office in April 2001 has implemented an ambitious framework of policy reforms designed to strengthen the public finances, achieve higher growth, lower unemployment and reduce poverty. The Offshore Finance Authority was created by Parliament to institute a new system to manage, direct, control and supervise the Offshore Financial Services Industry in SVG. After a number of closures in 2001, the sector now seems to be growing in a stable fashion. Key sectors are banking, trusts, insurance and mutual funds. There are about 10,000 International Business Companies. Historically, SVG has provided a high degree of confidentiality for investors, although an Exchange of Information Act passed in 2002 has qualified this to a certain extent.

Cable and Wireless provides telecommunications services in SVG; however the Government has liberalized the telecommunications market and two additional companies have been given licenses for mobile services. Following a substantial amount of new legislation, SVG was given a clean bill of health by the FATF in June 2003. The FATF Implementation Progress Report on SVG was very complimentary about the "substantial" amount of training provided to financial institutions with respect to anti money laundering requirements. The report also had high praise for the Financial Intelligence Unit, saying, "cooperation provided by the FIU has been excellent." The FIU has been accepted into the Egmont Group.

St. Vincent And The Grenadines Forms Of Company

Individuals or companies wanting to make use of the offshore sector in St Vincent and the Grenadines normally constitute either or both of an International Business Company or a Trust. The International Financial Services Authority (IFSA) of St Vincent and the Grenadines announced in May, 2004, that offshore agents will henceforth be able to incorporate companies for their clients online. This new development has meant that instead of taking one day to file the relevant documents and issue company certificates, the IFSA can now commit to ensuring that company documents are available for collection within three hours of the filing of the information by the agent. The online registry system operated by the Authority also allows agents to pay their annual fees over the internet, to reserve company names, and to conduct searches of company files. The system will be operated using a pre-payment model.

International Business Company

"What is an IBC?" - An IBC is a company that is registered and based in an international center such as St. Vincent & the Grenadines. The term "International Business Company" is used to describe it because it is formed in a jurisdiction that is outside one of the major industrialized countries, where there are certain benefits, including tax, privacy, financial and security benefits. When you form an IBC, you are generally in complete control of the assets of the IBC, in control of its bank accounts, and of all transactions done by the company. The income to the IBC is taxable immediately it is earned. This differs from income that you earn through shares purchased in a company in your homeland. The general rule for such shares is that you have a taxable event only when you receive distributions in the form of dividends.

However, in the case of the IBC, you are taxable even if you have not repatriated (i.e. brought home) any of the income. Although the provision of Bearer Shares could enable the owner of an IBC to conceal earnings through the IBC, it is evasion of taxes to fail to report and pay taxes in one's homeland and carries serious penalties. Our business is to inform, however, and not to moralize. It is not our place to tell you how to conduct your business, but to tell you what the consequences may be for a certain course of action. Let it be said, however, that we are not in the business of assisting anyone in evading taxes.

One consequence of having an IBC and an account in the name of the IBC is that Schedule B of the IRS form for US citizens, requires that one answer two pertinent questions. Do you own a bank account offshore? Do you have signature power over an offshore bank account? In general, anyone who has an IBC with one or more bank accounts should answer "Yes!" to both questions.

The only exception is when the bank account is in the name of an IBC that is owned by a trust. The International Business Companies Act No.18 of 1996 and regulations SRO No. 33 of 1996 and their amendments govern the incorporation of International Business Companies in St. Vincent and the Grenadines. Only a duly approved Registered Agent within the meaning of the new Registered Agent & Trustee Licensing Act (No.15), 1996, may submit applications for formations and undertake services set out in the Act. Key features of the International Business Company are as follows:

  • There are no requirements for a local director or any domicile requirements. One-director companies are allowed, and any director may be a corporate entity.
  • The publicly filed articles of incorporation contain a minimum of information including the name of the company, the Registered Agent, the currency of the capital and authorized capital, type of shares.
  • Company names must include a designation or abbreviation that signifies limited liability. Foreign denotations such as "Aktiengesellschaft", "Anonima", "Societe Anonyme" or the abbreviations such as A/S, SA, AG, GmbH , NV and BV are allowed. Incorporation under documents in foreign language is allowed provided translation is attached.
  • The filed articles of incorporation is designed to contain a minimum of information including the name of the company, the Registered Agent, the currency of the capital and authorized capital, type of shares and any other provisions that may be required by the company. A certificate of compliance by the Registered Agent or Solicitor that the requirements of the act have been complied with must accompany these articles. This is the only information on the Public Record. All other matters, such the operational aspects and rights of the shareholders, directors, and meetings are reserved for the by-laws, which are not public but remain a company internal document.
  • Two types of Incorporation Certificates are available, namely with or without the director’s name displayed.
  • A minimum of one shareholder is required which may be a natural person or a corporation. There are no requirements with regard to minimal share capital. Details of the shareholders do not appear on the public file. A wide range of types of share is permitted, including registered or bearer shares, voting shares, non-voting shares, shares that may have less than one vote per share, common shares, preferred shares, limited shares, shares limited by guarantee or redeemable shares, and share that entitle participation only in certain assets. No list of shareholders has to be submitted. Beneficial owners of shares are not made public. NB: The International Business Companies (Amendment) Act No.26 and 44 of 2002 now allows for the registration and custody of bearer share certificates by the Registered Agent who must also keep a record of each bearer certificate issued or deposited in its custody and the record shall contain pertinent information relating to the company issuing the shares, the ID number of the share certificate and identity of the beneficial owner.
  • Company books, share registers, etc., may be kept in or outside of St. Vincent. No limitations on where or how meetings may be held, and there are no mandatory annual returns.
  • An IBC may issue powers of attorney and management mandates in writing to any person.
  • Foreign companies may become IBCs by way of continuation; and IBCs may migrate to other domiciles.
  • The IBC act freely allows mergers and consolidations, mergers with a subsidiary, merger or consolidation with foreign companies etc.
  • An IBC receives upon formation a Government Certificate of Exemption from taxes for 25 years from the date of incorporation.
  • No annual return or accounts have to be filed with the SVG authorities thus allowing for total confidentiality of financial affairs.
  • The company must maintain a registered office address within St. Vincent and must also appoint a local registered agent.

Limited Duration Company

The IBC Act also makes provision for limited duration companies (pass through companies known as limited liability companies in the USA and resembling the German GmbH and Latin American-style "Limitada") with a single member, and provides for the governance of such entities under private operating agreements as opposed to by-laws. A company incorporated under the IBC Act may at any time apply to the Registrar to be registered as a limited duration company. The name of the company needs to include at its end "Limited Duration Company" or the abbreviation "LDC". The Registrar needs to be provided with a certified copy of a special resolution of the company altering its Articles to limit the duration of the company to a period of 30 years from the date of its incorporation or less. A limited duration company may by special resolution alter its Articles extending the duration of the company to such period or periods not exceeding in aggregate 100 years from the date of the incorporation of the company.

The Articles or By-Laws of a limited duration company may prohibit the transfer of any share or other interest of a member of the company absolutely, or may provide that the transfer of any share or other interest of a member requires either the unanimous resolution of all the members or a resolution passed by such proportion of the members as the Articles or By-Laws may specify. The Articles or By-Laws of a limited duration company may provide that a person ceases to be a member of the company upon the happening of any one or more of the events specified in the Articles, and may further provide that the rights of such former members shall be limited to an entitlement to receive such value for their shares in the company as may be determined by the Articles or By-Laws.


A Hybrid is a company limited by guarantee. It is said to be a hybrid because it partakes of the characteristics both of an IBC and a Trust. Such a structure could allow one to legitimately compound earnings offshore, on a tax-free basis, until funds are repatriated onshore. They provide a very flexible estate planning vehicle and have significant tax advantages for citizens and residents of the US, UK and Canada, because of the high degree of asset protection that they provide.

In a Hybrid, the initiators of the formation of the structure are Guarantors, who have liabilities of no more than US$100 whether from corporate expenditures or winding up fees. The Guarantors are never shareholders and as such do not experience taxable events when the Hybrid earns income. The shareholders are offshore entities as are the Directors. A guarantor has no voting rights and is not entitled to any dividends. Recent moves to curtail the flexibility of trusts on the North America continent could focus considerable attention on Hybrids as useful tools in offshore asset protection. Canadian taxpayers, for example, may avoid the Foreign Accrual Property Income (FAPI) rules by forming a Hybrid.


Trusts are constituted under the International Trusts Act 1996, as amended by the International Trust Amendments Act 2002. Trust deeds are registered in a confidential government Trust Registry, whereupon an official Certificate of Registration is issued to the Settlor/Grantor. Key features of the current trusts regime are as follows:

  • A duly registered trust will not be rendered unenforceable because it was invalid under the laws of the Settlor/Grantor’s domicile or residence. Thus, forced heirship law and community property regimes can be avoided.
  • The traditional rule against perpetuities and the rule against accumulations are modified and clarified in the current legislation.
  • Purpose trusts, which are created for a specific purpose but without named beneficiaries, are allowed and statutorily prescribed.
  • The role and duties of protectors are specifically set out and clarified to account for recent case law.
  • Choice-of-law and conflicts-of-laws issues are anticipated and resolved in favor of the provisions of the International Trust Act.
  • A foreign (non-Vincentian) judgment against a registered International Trust (or its settler or beneficiaries) is not enforceable in Saint Vincent if the judgment was based on law inconsistent with the International Trust Act, 1996.
  • Actions against registered international trusts must be commenced within two years from date of creation of the trust.
  • A complaining creditor may satisfy his claim against the property of a registered international trust only if that creditor can show both that the settlor/grantor’s principal interest in creating the trust was to defraud him, that the disposition of property to the trust rendered the settler/grantor insolvent.
  • Traditional fraudulent conveyance laws (Statute of Elizabeth) are not applicable to registered international trusts.
  • The bankruptcy or insolvency of the settler/grantor under the laws of his residence or domicile will not affect a registered international trust.
  • An international trust may own one or more Saint Vincent International Business Companies.
  • Registered trustees fall within the definition of ‘financial institutions’ of the Proceeds of Crime Money Laundering Prevention Act 2001 and are thereby subject to its anti money laundering requirements.

Internation Banks

Acquiring a Class I Banking License in St. Vincent and the Grenadines. St. Vincent & the Grenadines is considered a premier jurisdiction for securing a Class I international banking license for a number of reasons, including the following:

It is a clean jurisdiction that has not seen the problems that some other jurisdictions have experienced with their offshore banks. The due diligence work on the client(s) is done within 3 weeks. Approval is given by the Board of Directors at its very next meeting, following completion of due diligence. The fees associated with obtaining a banking license are some of the lowest in the Caribbean. The government has separated the promotional aspects of the work of the Offshore Finance Authority from its regulatory function. The Eastern Caribbean Central Bank (ECCB) now monitors offshore banks in St. Vincent & the Grenadines as it has monitored domestic banks for over 25 years. The deputy governor of the ECCB, who is a native of St. Vincent & the Grenadines is a member of the Board of Directors of the Offshore Finance Authority. The ECCB has the reputation of maintaining one of the strongest currencies in the world for the 9 states in the Organization of Eastern Caribbean States (OECS). The ECCB is viewed with respect all over the world and even the European Union sought information about this phenomenon before establishing the Euro.

Banks licensed in St. Vincent & the Grenadines are subject to the General Privacy Code of the Confidentiality Relationships Preservation Act, that makes it a criminal offense punishable with 5 years in jail and a fine of US$50,000 for disclosing anything about a client’s business anywhere in the world, unless it will help to solve a crime. There are only two other jurisdictions with this privacy code (viz., Anguilla and the Cayman Islands) and these are Overseas Territories of the United Kingdom. St. Vincent & the Grenadines is currently the only independent state, with a seat at the United Nations that has such a General Privacy Code. Most jurisdictions have special privacy codes that are not as sweeping in scope. The first step is to have a Registered Agent in the state to register an International Business Company (IBC). This IBC is then used as the vehicle for making the application. The IBC must name shareholders. Its shares cannot be Bearer shares, but must be Registered shares.

Following the formation of the IBC, the applicant(s) must submit, through the Registered Agent, a completed application form for a banking license. The applicant(s) must also provide due diligence information. We provide a list of the pieces of information required. The Offshore Finance Authority employs an investigating agency to do the due diligence work and this is normally completed within 3 weeks. Following the due diligence work, the Board of Directors of the Offshore Finance Authority considers its results and decides to recommend or not recommend the approval of the applicant to the government of the state, that has the final word.

The Offshore Finance Authority (OFA) now collaborates with the Saint Kitts-based Eastern Caribbean Central Bank, (ECCB), in the licensing and supervision of international banks. Although the OFA is ultimately responsible for granting all international bank licenses, the International Banks Act has been amended to provide for the ECCB to cooperate with the OFA in reviewing all bank applications as well as in ongoing supervision of banks. This is one of the many steps recently taken by the OFA to ensure that all its banks are well regulated and in compliance with the requirements of the laws and regulations that govern them.

All banks are subject to onsite inspections at least every 12 - 18 months. The Offshore Finance Inspector (Ag) Ms Louise Mitchell, has direct responsibility for banks. She works along with the OFA’S Banking Supervisor, Mr Dougal James. The Authority grants two Classes of Offshore Banking Licence: Class I Offshore Banking Licence; Class II Offshore Banking Licence. All Offshore banks applying for a licence to operate in St. Vincent and the Grenadines must submit a completed application (in duplicate) along with the prescribed fee to the Offshore Finance Authority. All applicants are required to complete a ‘fit and proper’ questionnaire. The following requirements apply to all banks that are issued with a licence to operate in St. Vincent and the Grenadine: they must establish a physical presence in the island; they must have local employees; there must be at lease one (1) local Director approved by the Offshore Finance Authority. The following condition also applies specifically to the different classes of Offshore Banks.

CLASS I. Non-refundable application fee of US$1,000.00. Each Class I bank must establish and maintain a capital fund with fully paid-up capital of not less than one million US dollars (US$1,000,000.00) or its equivalent in another currency. Class I banks are required to hold a deposit or invest the sum of five hundred thousand US dollars or its equivalent in another currency, in such a manner as the Authority may prescribe.

CLASS II. Non-refundable application fee of US$750.00. Each Class II bank must establish and maintain a Capital fund with fully paid-up. Capital of five hundred thousand United States dollars (US$500,000.00) or its equivalent in another currency. Class II banks are required to hold a deposit or invest the sum of fifty thousand United States dollars (US$50,000.00) or its equivalent in another currency in such a manner as the Authority may prescribed. Designate and notify the Authority by name a registered agent, which is not an official of the bank, to act as its registered agent in the state.

International Insurance Companies

The procedure for registering an insurance company in St. Vincent & the Grenadines begins with the formation of an International Business Company (IBC). This company is then used as the vehicle for the application for a license to operate an insurance company. Following the formation of the IBC, we will submit your application, using the application form provided by the Offshore Finance Authority. This form may be found in a copy of the Insurance Regulations that we can provide for you. The Commissioner of Insurance in the office of the Offshore Finance Authority has the responsibility to review your documents for completeness and compliance. The results will be submitted to the Board of Directors of the OFA for approval or disapproval.

Your company may choose to operate from an office in St. Vincent. Rental of office space is lower than in the United States and Europe and staff salaries are in the range of US$500.00 - $550.00 per month. Rental of telephone lines is US$15.00 per month. Although directors may reside in the United States or Europe, you may require a local manager to supervise the operations of the company.

Classes Of Insurance Licenses

Class I Unrestricted License permits the insurer to carry on any international insurance business, including long-term international insurance business.

Class II General License permits the insurer to carry on general international insurance business, but not long-term international insurance business.

Class III Association License permits the insurer to carry on general international insurance business and long-term international insurance business, with two or more owners of the insurer, and their affiliates, and to carry on no more than thirty percent (30%) of its international insurance business (based on net premiums written) with persons who are not owners of the insurer or their affiliates.

Class IV Group License permits the insurer to carry on any international insurance business, including long-term international business, with a single owner or that insurer and its affiliates, and employees of the owner or its affiliates.

Class V Single License permits the insurer to carry on any international insurance business, including long-term international business, including long-term international business, with the sole owner of the insurer, if a company, or with the beneficial owners of the insurer, if a trust.

Important Facts On The St. Vincent And The Grenadines Mutual Funds

Mutual funds are regulated by the Mutual Funds Act, 1997 as amended by the Mutual Funds (Amendment) Act 1998, with Regulations issued in 1999. The Act provides for the licensing of both domestic and offshore mutual funds. There are essentially two categories of fund licenses, namely a private and accredited fund license and a public fund license.

The legal structure that can form the basis of a St. Vincent mutual fund includes an incorporated company, a partnership or a unit trust. It can include an umbrella type fund. Open ended, closed ended and integral funds are allowed. A Public Fund means a mutual fund, which offers any shares, it issues for subscription or purchase to any interested member of the general public. All public funds registered must publish a prospectus and file it with the Offshore Finance Authority. There are no capital adequacy requirements or minimum subscription limits placed on public funds. Also they must maintain accounting records and financial statements. Public funds that intend to do business with residents must also submit an offering document synopsis to the Offshore Finance Authority.

Private and accredited funds is the other category of license recognized by this Act. A private or accredited fund is a mutual fund that either has no more than fifty investors or issues shares on a private basis. An accredited fund issues shares only to accredited investors, with an initial investment of not less than USD 25,000. An accredited investor is one who has a net worth in excess of USD one million. All applications to carry on business, as a Public Fund or Private Fund must be submitted to the St. Vincent and the Grenadines Offshore Finance Authority to the attention of the Registrar of Mutual Funds.

Insofar as administrators and managers are concerned, they are required to apply to the Authority for a license to carry on business as administrators or managers. The Act provides that a natural person, any mutual fund, company, trusts or trustee may apply for a license to carry on business as administrators or managers. Applicants must show evidence that they have or have available to them expertise and resources necessary to carry out the business proposed. The applicant must meet standard fit and proper requirements. The competence and character of managers and administrators is seen as paramount to the efficient operation of the Mutual Fund and the integrity of the jurisdiction. Accordingly, the Authority requires that only fit and proper persons may be issued licenses to carry on business as managers and administrators.

St Vincent And The Grenadines Offshore Legal And Taxation Regime

Swiss lawyers introduced St. Vincent and the Grenadines (SVG) to the international financial services sector in 1976. Three years later the country gained independence from Britain and embarked on the process of nation-building - setting up the foundations of an independent nation state. When the country was more mature it was able to take a second look at the international finance industry in 1996 and take the policy decision to move this sector into the forefront of the national economy. The international finance legislation was overhauled and a package of financial laws was introduced. Regulated and licensed agents and trustees, known in SVG as Registered Agents, provide international financial services. The Offshore Finance Authority was created by Parliament to institute a new system to manage, direct control and supervise the offshore financial services industry in the country. Its role was clearly defined by its governing statute - The Saint Vincent and the Grenadines Offshore Finance Authority Act, 1996. The business of The Authority is under the direction of a five-member board of directors.

In November, 2003, the Offshore Finance Authority was re-named as the International Financial Services Authority (IFSA). Speaking on the new name of the Authority, Deputy Governor Errol Allen said: "The change of name to International Financial Services Authority must however be seen in its proper context. If an organization is to meet the challenges of a changing world, it must be prepared if necessary to change everything about itself, except its beliefs, as it moves through corporate life. The only sacred part in an organization should be its basic philosophy of doing business. It therefore follows that our organization can change its operating practices and business strategies constantly, in response to a changing world." On the new financial environment Acting Offshore Finance Inspector Louise Mitchell stated "We have an industry to build. Much groundwork has been done. We are not starting from scratch. In fact we have a very solid foundation, but we have new [regulatory] rules in the game. The application of these new rules will require much effort and commitment on behalf both of the regulator and the regulated." IFSA has the following specific responsibilities:

  • To administer and oversee the process of licensing Registered Agents, Private Trustees, Financial Fiduciaries, and Registered Trustees and regulate the activities of Registered Agents and their services to ensure compliance;
  • To administer and oversee the licensing, regulation and supervision of International Banks;
  • To appoint, and to supervise the activities of, the Offshore Finance Inspector; and
  • To oversee the activities of the Registrar of IBCs and the Registrar of International Trusts.

In 2001, in response to the increased international attention being paid to the operation of international offshore financial centres, SVG's legislation was substantially amended, and an enhanced regulatory structure was put in place. At this time, the government, in its attempt to ensure that the international banking sector was reputable took the strategic decision in 2001 that the Eastern Caribbean Central Bank should have a significant role to play in the supervision of the international banks in SVG, in conjunction with the OFA. The International Banks Act was amended in May 2002 to provide for the joint supervision of international banks with the ECCB. This development has greatly increased the capacity of the regulatory regime.

St. Vincent and the Grenadines now has a small, carefully vetted and properly regulated international private banking sector. At present there are only ten banks licensed to conduct international banking business. The regulatory body, the Offshore Finance Authority, has concentrated its efforts on ensuring that only banks with a real presence, and sound business operations and policies, operate in SVG. There are no shell banks licensed in St. Vincent and the Grenadines. All banks have been and will be subject to further on-site examinations by the authorities every 12-18 months.

St Vincent And The Grenadines Offshore Business Sectors

A new St Vincent and the Grenadines investment promotion agency, National Investment Promotions Inc. (NIPI), commences operations in August 2004, taking over from the Development Corporation (DEVCO), which initially managed the investment promotion functions of St Vincent and the Grenadines. The new agency reports to the Office of the Prime Minister, Dr Ralph Gonsalves. Since securing its removal from the Financial Action Task Force (FATF) blacklist of Non-Cooperative Countries and Territories, the Caribbean jurisdiction of St Vincent and the Grenadines has reported strong growth in the registration of international business companies. According to the International Financial Services Authority (IFSA), by the end of April 2004, some 357 new IBCs had registered in the country, compared to 194 during 2003, representing growth of 84%.

In addition, 2004 has seen the licensing of two new mutual fund entities and five international insurance firms, and the Authority has reported strong interest in both of these sectors from potential investors. Representing a further sign that the international finance community is taking more notice of St Vincent, the IFSA is currently processing the jurisdiction’s first new banking application for two years.

Offshore Bank Accounts

Most people who open an offshore IBC and/or Trust seek also to have offshore bank accounts and credit card accounts in order to maximize their privacy. The wealthy families of the world have been doing this quietly for decades before ordinary people became aware of the practice. It is for this reason that banks in the Cayman Islands alone have more money than all the banks in New York (i.e. over US $800 billion). Coddan provides assistance in setting up such accounts in Switzerland. We also provide logistic support to clients who wish to open accounts in the Caribbean and other parts of the world. Please note that Swiss banks are insured by the government of Switzerland and can offer checking and savings accounts in US dollars, Sterling and Euros. Credit cards and debit cards are also available. Switzerland is the country with the fourth largest gold reserves in the world and has been the most stable and reputable banking center in our times.

Should You Pay Taxes?

Most definitely, YES! It is foolhardy to try to form an offshore company in order to evade paying taxes. It's just not worth it. Besides, there are severe penalties for non-payment of taxes in the country of residence (most notably in the United States). While it is still O.K. to form an IBC with Bearer shares, if you are trying to use this as a method to evade paying taxes, forget it. Governments today are bent on having their taxes and will ignore such things as Nominee Shareholders and Nominee Directors and will look to the substance of the arrangement, rather than the form. Anyone can act as owner or agent the company, but if you provided the financing for formation, you will be treated as the owner for tax purposes.

It makes no sense to try to keep it a secret that you have formed an IBC. Your telephone, email and fax records are now more closely monitored than ever before and growing government deficits are making it necessary for governments around the world to devote more intelligence muscle to ferreting out tax dodgers. The major benefit of an IBC is maintaining your financial privacy and protecting your assets from lawsuits. Trying to keep it secret from the taxing authority of your country is a dangerous game and one that may sooner or later be discovered with disastrous consequences. The ones who may leak information about your secret are often the ones who are or have been closest to you. It is reported that most of the people who leak this information do not even bother to collect the rewards. They are just trying to get even with a former lover, husband or friend. You should stay within the law by filing the appropriate forms that disclose the existence of your IBC and its offshore bank account.

An IBC that is used in active trade or business outside of your country (international business) may be able to accumulate profits tax free until it is repatriated to the country of residence, but if investments are done in your own country through the IBC, this may be skirting the law if there is no disclosure. How about trusts? These are supposed to be more private than IBC's. Several years ago, U. S. citizens could defer payment of taxes earned by a foreign trust if the trust was an irrevocable trust and the initiator of the trust did not maintain any control over the trustee. That has all changed. In 1977, the US created IRC 679 that treats a US trust with a grantor and a U. S. beneficiary as a grantor trust. The person who "settled" funds on the trust is treated as the owner of the trust and is taxed on its income.

If an offshore company was created to be the grantor of the newly formed trust, the IRS will treat that company as the nominee or alter ego of the US person creating the trust and that person will be treated as the only owner of the offshore company. It is no good to form a trust without a US beneficiary because under IRS 679 an offshore trust is treated as having a US beneficiary unless the trust document specifically states that no income can be paid to or for the benefit of a US person, whether during the life of the trust or upon its termination. This effectively cuts of any living person in the US from benefiting from the trust and the trust effectively becomes a charity. There are still some legal ways to defer payment of taxes and in some cases to avoid payment of taxes, but you need to consult with a tax attorney in your country for this. Also be aware, that tax avoidance and tax evasion are now seen in some circles as being one and the same thing, notably in European countries.

If you have already formed an IBC or Trust and have not completed the appropriate declarations in your country, you may need the help of a competent tax attorney who practices in criminal court to smooth the path with the taxing authority in your country. Do not ever make the mistake of trying to move offshore funds from an undeclared company or trust account into your country and then getting it taxed without getting the advice from such an attorney. This carries a more severe penalty than tax evasion, because the offence comes under the category of Money Laundering and anyone who assists you in accomplishing this is guilty of conspiracy to commit the crime. It is best to engage a criminal tax attorney to assist you as it is better to settle with the tax authority before you are caught, than to try to settle after you have been caught. Having said all of this be aware that fully one-half of the wealth of the world is in international financial centers and that with increasing predatory litigation, government controls and confiscation of funds on a whim, this trend will continue. IBC's and Trusts are likely to continue to be with us for a very long time. Just be sure that you are within the law.